France's Hollande pledges payouts, price freezes after win

PARIS (Reuters) - French presidential front-runner Francois Hollande said on Wednesday he would freeze fuel prices, slash government ministers’ salaries and boost welfare payouts to families in a rush of legislation in his first eight weeks in office.

Francois Hollande (C), Socialist Party candidate for the 2012 French presidential election waves to supporters as he campaigns in Blois April 3, 2012. REUTERS/Jacky Naegelen

Seeking to steal momentum from incumbent Nicolas Sarkozy, who will unveil his manifesto this week, Hollande laid out a roadmap for his first year in power.

The measures largely re-packaged Hollande’s election manifesto, launched in January, but put a firm timetable on a series of economic reforms between the final round of voting on May 6 and the breaking of parliament at the end of June.

They included a three-month freeze on fuel prices, a 25 percent increase in annual allowances for parents of school children and guaranteed above-inflation interest rates on tax-free savings accounts, as ways to bolster consumers’ purchasing power.

Hollande said he would also cut the salaries of the president and cabinet ministers by 30 percent and set new limits on ministerial staff numbers. Other measures centered on employment, consumer spending and managing public finances.

NOT IN DENIAL

Hollande’s announcement came after an article in the Economist weekly entitled “France in Denial” made waves in political circles, by accusing presidential candidates of lacking serious ideas for tackling France’s economic problems.

Hollande’s campaign chief Pierre Moscovici told Reuters on Tuesday he disagreed with the article. “As far as we are concerned, there is no denial of the French situation,” he said.

“We are concerned about growth and responsible for it. But we also have a left-wing standpoint.”

Hollande promised to present a law on balancing the budget to an extraordinary parliamentary session in July.

He also pledged to eliminate tax exemptions and write into law his plan for a 75 percent tax on annual income above a million euros.

That law was partly inspired by frustration with news that chief executives of the country’s biggest stock market-listed companies took bumper pay rises in hard times.

Hollande told Paris Match magazine he would call a meeting with CEOs of the top listed groups and tell them: “We need you and you need the state.”

Jean Francois Cope, who heads Sarkozy’s UMP party, called Hollande’s roadmap “totally irresponsible”. “Now the truth is out he can no longer hide,” he told LCI television.

Sarkozy, who has opted to unveil his campaign ideas one by one for maximum impact, has proposed holding policy referendums, reducing the flow of both legal and illegal immigrants into France, making the long-term unemployed undergo training to keep their benefits and making tax exiles pay up.

Hollande said he would spend his first days in office negotiating amendments to a European Union treaty on budget discipline signed last month by 25 EU leaders to add new clauses to stimulate growth.

Hollande had already said he would travel to Berlin within days of becoming president to discuss his ideas with German Chancellor Angela Merkel.

Hollande, who will hold a campaign rally in the northwestern city of Rennes on Wednesday, also repeated a promise to bring forward France’s troop withdrawal from Afghanistan to the end of 2012.

Additional reporting and writing by John Irish, Catherine Bremer and Brian Love; Editing by Andrew Heavens